USW: Proposed Tariffs for China Pipe Sends Message to U.S. Workers

Contact:  Gary Hubbard, 202-778-4384; 202-256-8125 >

Washington, DC (Nov. 5) – The United Steelworkers (USW) called today’s order by the U.S. Department of Commerce for proposed anti-dumping tariffs on China pipe imports known as oil country tubular goods (OCTG), an overdue message for thousands of American laid off workers that trade laws are being enforced.

According to documents, the OCTG trade case is the largest in U.S. history against China imports valued at $2.6 billion in 2008. The U.S. government order confirms overall, China’s practice of dumping OCTG. This is the fifth pipe and tube products dumping case since June 2007.

USW President Leo W. Gerard cited today’s Commerce Dept. anti-dumping margins for OCTG China exporters as promising to U.S. producers with nearly half its work force on layoff status caused by the huge inventory of dumped China pipe imports. “China’s government and exporters are being told we are fed up with their cheating on our fair trade laws and penalties for these transgressions are long overdue.”

The China-wide tariff margin announced by the Commerce Dept. is 99.14 percent. However, Gerard was critical of the ‘zero’ tariff margin affixed to Jiangsu Changbao Steel Tube Co.  – one of China’s largest OCTG exporters. “We question why Changbao was singled out as if they were the only one among 75 other pipe exporters who were considered not in violation. We plan to challenge this finding as the case proceeds in our government’s investigation.”

He adds: “Consistent and swift U.S. trade law enforcement must be the standard with our trading partners if we are to retain good jobs and rebuild our economic manufacturing capacity.” The USW president said nearly half of the domestic industry’s 6,000 workers are now laid off. “China’s dumped and subsidized OCTG pipe imports are a threat to working families and the future of a critical product used in our nation’s energy extraction industry.”

Seven domestic OCTG producers and the USW filed an antidumping and countervailing duty trade case against China imports with the International Trade Commission (ITC) and the U.S. Department of Commerce (DOC) on April 8 of this year.  OCTG represents welded and seamless steel pipes that are used to extract oil or gas from a drill well.

USW Vice President Tom Conway, who handles labor agreement negotiations with the pipe companies, said the U.S. government investigation in the OCTG trade cases, ‘gives reason to believe there will be a callback of laid-off American pipe workers who can share in the recovery of this industry once the unfairly-traded Chinese import inventory is de-stocked.”

In September, the Commerce Dept. found China OCTG exporters benefited from massive government subsidization and announced countervailing duty margins ranging from 11 to 31 percent. According to the USW, the increase in Chinese imports of OCTG are made worse by the global recession that increases the impact on good jobs in the steel and pipe manufacturing sector.

In addition to the USW as co-petitioner, the seven producers of the OCTG petition are:  U.S. Steel Corp., Pittsburgh, Pa.; Maverick Tube Corp., Hickman, Ark.; Evraz Rocky Mountain Steel, Pueblo, Colo.; TMK IPSCO, Downers Grove, Ill.; V&M Star, LLP, Houston, Texas.; V&M TCA, Houston, Texas.; and Wheatland Tube Corp., Beachwood, Ohio.

Roger Schagrin, trade counsel for the USW at Schagrin Associates of Washington, DC, said today’s Commerce Dept. order allows the U.S. to begin collecting a bond that will go into an escrow fund for all future OCTG imports. The next step in the trade cases will be an ITC public hearing on Dec. 1.   A final anti-subsidy or countervailing duty determination will be made by the Commerce Dept. later this month, with a first ITC injury determination in early January, while the dumping portion of the trade case will be finalized in Spring 2010.

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